Governor Christie Announces Additional $72 Million Settlement With Volkswagen Over Clean Air Violations

Gov. Chris Christie announced New Jersey will receive $72.2 million, among the largest in the country, from a federal trust created to mitigate the harm to public health and the environment caused by Volkswagen’s decision to install cheating devices on thousands of diesel vehicles in New Jersey. These funds are in addition to the $69 million settlement just reached with Volkswagen to resolve a stand-alone lawsuit brought in state Superior Court by New Jersey against the automaker.

“My administration has taken action against Volkswagen to secure some of the largest awards to protect New Jerseyans from health hazards, environmentally threatening emissions, and unlawful profit-oriented cheating schemes,” Governor Christie said. “I am proud of these results that should deter any company thinking of similarly deceitful practices. These funds will be used to protect public health, our environment, and provide residents with cleaner air.”

Volkswagen’s cheating software allowed its vehicles to pass emissions tests even though the company’s vehicles, in fact, emitted higher levels of nitrogen oxides (NOx) than permitted by law. NOx is a precursor to ozone, which presents a significant health concern in many parts of the country, including New Jersey. Under the terms of the federal settlement, Volkswagen must fund a mitigation trust to pay for certain eligible projects to reduce harmful NOx emissions from diesel engines.

Governor Christie designated the New Jersey Department of Environmental Protection (DEP) as the lead agency to administer the use of these settlement funds.

“Nearly 75 percent of the NOx emissions in New Jersey come from cars, trucks, and diesel equipment and Volkswagen’s illegal actions unnecessarily damaged our air quality,” DEP Commissioner Bob Martin said today. “We are committed to using this money to mitigate that damage and improve New Jersey’s air quality.”

Consistent with the parameters of the mitigation trust, New Jersey will use these funds to complement its efforts to reduce diesel emissions and foster clean electric vehicle infrastructure.  Specifically, New Jersey will first submit a “Beneficiary Mitigation Plan,” a document that will lay out how the State intends to use the funds on particular projects to reduce air pollution.  Upon approval by the federally-appointed trustee, funds will be released to support projects identified in the Plan. The DEP has already begun to develop the State Plan.

All 50 states, Puerto Rico, the District of Columbia, and Indian tribes are eligible to become beneficiaries of the mitigation trust.

New Jersey has a successful track record of programs to protect the public from harmful diesel exhaust.  Diesel emissions are highly toxic and have cancer-causing effects.  The Mandatory Retrofit Law of 2005 reduced emissions from vehicles that travel in our neighborhoods by installing emission control devices to reduce particulate emissions from school buses, transit buses, garbage trucks, and publicly-owned on-road vehicles.  The DEP’s Clean Construction Program is a voluntary program that provides funding to install emission control devices on construction equipment or to replace old equipment with the cleanest equipment available.

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